What a scary market means for enterprise startups

Eric Knorr |
July 1, 2016

As ominous economic signs loom, is a glorious run of exciting new tech cooked up by enterprise startups coming to an end?

As Ashutosh said, "the financial markets do what the financial markets do." Many successful companies have started under terrible market conditions. It's all about whether the product or service being offered fits the market.

I'd also add that while it's still tough for open source companies to make real money, a robust open source community can help sustain technology development, even when budgets must be cut. Often, the core technology already exists: Mesosphere, for example, was built on the Apache Mesos cluster manager created at UC Berkeley's AMPLab. Also, as everyone knows by now, the ability of customers to download and deploy open source software may be the best free marketing there is.

Companies like these five startups are delivering real value to the enterprise market, which is tiny compared to the consumer market. The financial press likes to lump tech into one bucket, and as Rivers observed, has been actively celebrating companies that are "overvalued and overextended." Now, as the market slips, they're trashing those high flyers -- and disparaging the entire tech sector in the bargain.

Uber and Snapchat and Pinterest occupy a different world than Actifio or Okta or Cumulus Networks. Each one stands on its own value to customers.

Even if we're headed for more than a correction and face an impending recession, enterprise startups delivering targeted solutions that improve productivity or reduce cost will prevail, even if they have to go into cockroach mode.